What do Mark Zuckerberg, Bill Gates and Steve Jobs all have in common? All of them left school without a degree. While this is inspirational and to some motivational, it is misrepresentative of the level of qualification that is needed to get to even near the kind of level they achieved. To illustrate, by 2020 it is expected that 65% of all jobs will require a further education qualification, with 35% expecting a degree level qualification.
The UK is world-leading when it comes to students continuing their education beyond 16 years of age, with almost half (47%) of school leavers attending university. This figure has increased over the last 30 years by nearly 30% which is extraordinary, especially considering how much the overall costs of obtaining a degree and the level of student debt are currently.
The benefit, or ‘graduate premium’, to the time and money invested in the 3 year (minimum) degree is an advantage when it comes to entering the job market. The expectation is that the reward will be better prospects all round – a steeper upward trajectory when it comes to earnings, more opportunities, easier hiring and promotion chances, and a leap-frog onto the ladder as a starter.
To an extent, this is a realistic expectation. Almost all (96.4%) graduates in the UK are in employment or continuing to study 3.5 years after graduating; graduates are paid an average of £6,000 a year more than those without a degree and most employers now look for university level education as a pre-requisite. In 2016, over 80% of university graduates were in employments vs 70% of non-graduates
This graduate premium, however, is narrowing.
Since the global financial crisis of ten years ago, employers have now upped the stakes when hiring for open positions. There now exists a ‘degree inflation’ where the expectation of qualifications for roles traditionally not requiring a degree-level qualification has increased. This change in expectations isn’t just on academic ability, it’s also considered that graduates would be more productive and more engaged than workers without a degree. One in ten graduates are considered overqualified in their role and that they’re doing a job that doesn’t use any of the skills or knowledge that their degree provided, eg estate agents, police officers, nurses, supervisors, technicians, sales reps, production managers. Employers are also looking at communication, administration and project management skills, as well as initiative and commitment to complement their degree qualification. This ‘degree inflation’ is causing a dangerous effect on the job market and this black and white barrier is resulting in the wrong people being in the wrong roles, resulting in decreased morale and increased staff turnover and the cycle continues.
It is thought this inflation is due, in part, to the backlog of roles as a result of the freeze of graduate schemes that employers used to offer unique opportunities to university leavers. This has created a saturation in the job market that has led to over-inflated expectations on the part of employers. It is possible that candidates are immediately filtered by their level of education and unsuccessful candidates’ alternative skills are not taken into consideration.
It is worth noting that there is still some movement in more creative roles where degrees can be considered less important than more practical skills. Conversely those entering Law, Economics and Management enjoy higher employment rates and higher salaries. Behind this, earning around £1000 less are those with Science, Technology, Engineering or Maths degrees.
There are alternatives, of course, to degree educations. There are apprenticeships, internships and other further education qualifications such as BTEC, City & Guilds and OCR. The value of these all rely on employers valuing these other forms of education that offer different skillsets. It is naive to assume that university graduates have all the skills that all jobs require. It’s important to consider the value of skills offered by less academic individuals. Apprenticeships are a good example of how the government and industries can work together to encourage an alternative approach to the corporate career ladder, with a focus on competency rather than credentials.